16 July 2005

Child Labor Trends in Vietnam

WHEN Americans think about child labor in poor countries, they rarely picture girls fetching water or boys tending livestock. Yet most of the 211 million children, ages 5 to 14, who work worldwide are not in factories. They are working in agriculture - from 92 percent in Vietnam to 63 percent in Guatemala - and most are not paid directly.

"Contrary to popular perception in high-income countries, most working children are employed by their parents rather than in manufacturing establishments or other forms of wage employment," two Dartmouth economists, Eric V. Edmonds and Nina Pavcnik, wrote in "Child Labor in the Global Economy," published in the Winter 2005 Journal of Economic Perspectives....

Some of the best data, and the most noteworthy results, come from Vietnam, which tracked about 3,000 households from 1993 to 1998. This was a period of rapid economic growth, in which gross domestic product rose about 9 percent a year....

The effects were greatest for families escaping poverty. For those who crossed the official poverty line, earning enough to pay for adequate food and basic necessities, higher incomes accounted for 80 percent of the drop in child labor. In 1993, 58 percent of the population fell below the poverty line, compared with 33 percent five years later....

The results from Vietnam suggest that families do not want their children to work. Parents pull their children out of work when they can afford to, even when the wages children could earn are rising. Poverty, not culture, appears to be the fundamental problem.

Rather than simply banning child labor, then, policy makers should concentrate on alleviating poverty. That includes not only encouraging economic growth but also improving access to schools and to credit markets. Borrowing could allow families to buy equipment to substitute for child labor, to weather short-term declines in income and to pay school fees....

"Most child labor policy even today is directed at trying to get kids into unemployment - to limit working opportunities for kids," he said in the interview. But, "if households are already in a situation where they don't want their children to be working, but they're forced to because of their circumstance, taking additional steps to prevent the kids from working is punishing the poorest for being poor."

I suspect most child labor policy is designed to protect child laborers in one region from competing against adult laborers in another. Concentrating instead on economic growth in the poorer region would in the longer run be more likely to create new wealth, new markets, and therefore new jobs in other regions as well.